Two leading cryptocurrency exchanges, Binance and Bitget, have initiated investigations into the trading activities surrounding RAVE token from RaveDAO, following allegations by onchain sleuth ZachXBT that insiders orchestrated a significant short squeeze causing an abrupt price increase.
Gracy Chen, CEO of Bitget, confirmed that their exchange had “started investigating” the matter. Similarly, Binance CEO Richard Teng announced publicly that his platform was also examining the claims and committed to addressing any indications of market misconduct. Gate, another exchange, was implicated in ZachXBT’s probe.
ZachXBT has offered a $10,000 reward for whistleblowers who provide evidence about those involved, through private communication.
The little-known RaveDAO project experienced a dramatic surge earlier this week, leading to over $44 million worth of bearish RAVE positions being liquidated in one day. This followed a 4,500% increase in the token’s value over just a week. A significant short squeeze was observed due to the concentration of RAVE tokens in only three Gnosis Safe wallets, which held nearly 90% of the supply at the time.
Investigations revealed suspicious transfers of tokens to exchanges right before the price surge began, with millions of tokens moved ahead of the rally.
RaveDAO positions itself as a Web3 initiative dedicated to electronic music events, offering blockchain ticketing and community governance. Originating from an Istanbul afterparty in 2023, it has since organized events globally and reported around $3 million in revenue by 2025.
Despite its niche origins, RAVE’s market behavior was erratic: trading below $0.50 for most of its history before a rapid climb in April, surging from about $0.30 to over $6 in one day, peaking above $27, then declining. At its height, RAVE’s market cap briefly exceeded $6 billion, placing it among the largest cryptocurrencies by market cap before falling significantly. Currently, the token is down more than 50% from its peak and 30% over the past 24 hours.
Another claim involves a “bait and liquidate” strategy, where visible transfers indicate selling pressure, enticing traders into short positions. If those tokens are withdrawn as prices rise, short sellers may need to cover their positions at higher costs, benefiting others.
While unproven, the high concentration of token supply makes such scenarios plausible.
Reports have connected RaveDAO to individuals involved in previous crypto projects like ARPA and Bella Protocol, though these claims lack independent verification. The named individuals have not publicly responded.
RaveDAO addressed allegations on social media, stating that their team was neither engaged in nor responsible for the recent price fluctuations. While they did not comment on specific onchain accusations such as supply concentration or pre-pump transfers to exchanges, RaveDAO confirmed plans to liquidate some unlocked tokens “when appropriate.”
The project expressed interest in implementing price-triggered or performance-based lock mechanisms to align team incentives with ecosystem growth but has not committed to any particular method or timeline.
CoinDesk has reached out to RaveDAO for further comments.